Firms' strategic choices could disrupt markets, impact consumers
In this research, the focus is on how companies compete when they're selling similar products. The authors look at whether it's better to set the quantity of products or prices in a duopoly. They found that in a situation where one company is both making and selling products, it's more profitable to compete on prices. This goes against what people usually think. The study also shows that when management is involved, things get tricky because the two companies may end up in a situation where they can't settle on one way to compete. However, if the products are very similar, the firms can find common ground even with managerial involvement. Ultimately, the type of competition chosen can vary based on how different the products are.